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NICE "central" to value-based pricing of medicines

pills-articleNICE will have a crucial role in the value-based pricing of medicines from 2014, the government has confirmed.

The move was announced in the Department of Health's response to the Health Select Committee's report on the future role of NICE.

In the response, the Department of Health said: “We have already made it clear that NICE will have a central role in the value-based pricing system, including in undertaking an assessment of the costs and benefits of different medicines, drawing on its world-leading expertise.

“We can now go further, and confirm that NICE will be responsible for the full value assessment of medicines under the future system.”

The Department of Health added that NICE will build on its current drug evaluation processes by giving it broader scope to assess a medicine's benefits and costs. The aim is to make sure that the price the NHS pays for new medicines is more closely linked to their value to NHS patients and society.

Value-based pricing will replace the current Pharmaceutical Price Regulation Scheme (PPRS), which expires in January 2014.

The government believes that although the current system of pricing medicines has tried to achieve a balance between reasonable prices for the NHS and a fair return for the industry to develop new medicines, it does not promote innovation or access.

Too often, the NHS has been in the position of either having to pay high prices that are not always justified by the benefits of a new medicine, or having to restrict access.

Lord Howe, Health Minister said: “We are delighted to announce the central role NICE will take in assessing the value of new medicines. This will allow us to draw on NICE's world-leading expertise as we develop the Value-Based Pricing scheme.

“The role of NICE is developing and growing as it takes on new responsibilities in social care. We are grateful to the Health Select Committee for their detailed report and helpful recommendations covering various aspects of NICE's work.”

Sir Andrew Dillon, Chief Executive of NICE, added: “We welcome the opportunity to take the central role in value based pricing and we look forward to working with the Department of Health and our stakeholders in developing the methods and processes for the new system.”

The announcement comes as NICE is also preparing to take on other new responsibilities. From April, its remit will be extended to cover social care, as well as the NHS and public health. This will assist in the development of better integration of services between different health and care organisations.

22 March 2013

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Copyright 2014 National Institute for Health and Care Excellence. All rights reserved.